Household Consumption Analysis in Rawalpindi

Household Consumption Analysis in Rawalpindi Imran Ejaz 1. Introduction: Consumption and production generate economic activities in an economy. Consumption and production go side by side. Consumption creates demand for further production of goods and services. It is not wrong to say that if there is no consumption there is no economic activity in the country. Only the final purchase of goods and services is known as consumption, and every commercial activity is for production purpose. Consumption can be expressed in two ways. In nominal, means the money spent on the purchase of goods and services, and in real, means the deriving of the utility of goods and services for the satisfaction of wants e.g. using up of consumer goods both durables and non durables. Consumption amounts to the biggest part of Pakistan which accounts for 81% of Gross Domestic product in 2013 according to World Bank statistics. Consumption is also termed as the total spending on goods and services in an economy. The consumption function is used to estimate the proportion of total consumption in an economy. In social sciences, the consumption function is a used to express trend of consumer spending as income of people rising and falling. Consumption function provides an excellent illustration of a typical sequence in the development of the country and standard of living of the people. Bentham (1748) also considered production and its usage as important determinants of an economy. The process of consumption was vital for any system to sustain. Keynes (1936) addresses the theory of consumption, which showed the relationship between consumer income and consumption. According to Keynes, â€Å"People on average, have behavior that when their income increase, they spend more, but not as much as their income raises. It is made up of autonomous consumption that was not influenced by current income and induced consu mption that was influenced by the economy’s income level. Chow et al. (2001) did a research about the Chinese economy and Chinese entrepreneurs who had grown along with the Chinese economy. This research paper compares and contrasts the consumption habits of low and high income business class and concluded that small businesses incomes are transitory and more unstable hence their consumption is less and they tend to save more on the other hand entrepreneurs who earn more and largely spend on meals, moving from one place to other, private formal education and expensive items as their incomes were permanent and stable over a period of time. Socio-demographic factors, geographic locations of household have significant effects on the tastes and preferences. Similarly, gathering and socializing activities of consumers that were carried out are the second largest expense in their budgets as they need a lot of networking to succeed the business. But low income class spends a larger amount of their income on health issues, education of their masses . Tai and Tam (1997) discussed the consumption behavior of females that was changing due to the  different socio economic factors such as delayed marriage, smaller family size and single parents  have lead to changing dynamics of consumer market as a result the consumer preference were  changing and consumption pattern of the families. Siddiquie (1982) analyzed the consumption patterns based on the Engle law in terms of income, household size and number of earners. The study showed that the consumption of food and non-food items was strongly affected by the changes in total expenditures and size of households. Consumption patterns in Pakistan have been estimated by Burki (1997) using time series data. By using Almost Ideal Demand System (AIDS) technique and data from 1972-1992 there was an exogenous growth in non durable food items demand irrespective of the movements in their prices and growth. Study focused that the policy makers should focus on own price elasticity to predict impact of taxes. This study will be developed on the basis of Household Consumption in Rawalpindi. The study will include both cross-sectional and time series data of consumer behavior. Questionnaire will also be developed to address the study beside secondary sources. In this study econometric model will be developed by taking income, age, family size, consumer price index as independent variable and household consumption as dependent variable. Expenditure on food items will be used as a proxy variable. 1.1 Objective of the study: The objectives of the study are as follows: To analyze the significance of demographic factors (family size, age) on household consumption expenditure in Rawalpindi. To study empirically the impact of economic factors (income, consumer price index and household consumption expenditure in Rawalpindi) 1.2Significance of the study: Consumption is the sole cause and biggest reason due to which all economic activities begins ranging from hiring of services of factors, investing money, constructing factory or building and many more. As if there is no consumption in any society there is no need for activities of any type ranging from running a business or employing somewhere in any capacity. In short it is the consumption so that economies lively exist otherwise not. Consumption is an important function of income but there are many other factors that influence the  consumption pattern there are incidence when two households with same income level may have  different consumption pattern due to lifestyle, preference and the stage of life cycle they are in as a  household greatly affects the consumption patterns. All these researches try to explore the behavior  patterns that are crucial for molding the consumption pattern all these researches have added  different key reasons and not a single research as been able to come up with any common behavior  traits in the different societies of the world this phenomena indicate that the consumption patterns  changing according to society the house hold resides in. Income is the main component on which the consumption depends. The study will incorporate the causal relationship between household consumption to income and household consumption to consumer price index which is the important and new in this study as compared to the work done earlier. This study will be a bird’s eye view about every citizen consumption pattern which is affected by macro economic variables and demographic factors. Review of Literature: Thomas (1993). In this paper he tried to find out whether all household members share same preferences or they were dictated by any one member of the household. They came to a conclusion that when income was in hands of females shares of expenditure increases towards housing, education, health, household services and recreation when males were given the budget they tend to spend excess on health, household service and recreation. Education was considered intervening variable for earning hence increase in consumption, so they excluded education from demand function and include it as a valid instrument for total income. The researchers have come to these conclusions by conducting linear and quadratic models on the complied data Carroll et al. (1994) conducted a research about habit formation that consumption was happened at same level when a household was not enjoying same level of income as it did previously. Secondly they tried to analyze the impact of consumer sentiments on the consumption patterns taking into considerations the various economic variables into account. They ruled out permanent income and pure life cycle hypothesis and stated consumer spending was an unclear measure of uncertainty when uncertainty increased the level of consumption fell down hence leading to precautionary savings. Fei et al. (2003) conducted a research explaining the fact how children influenced the spending patterns of family and in about 27.8% of families, children’s consumption used one third of the family’s total income. In 35.6% of families, children’s consumption used 40% of the family’s total income. In 19.4% of families, children’s consumption took one half of the family’s income. And in 7.4% of families, children’s consumption took over one half of the family’s income. Thus in most families, the child’s consumption level was higher than the average per capita consumption of the family. He highlighted various factors such as higher education levels for children including extra amounts paid for private education and tutors.Moreover more recreational activities and high end gadgets like mobiles phone, laptops and increased expenses towards health care of the children. Khan and Dhar (2004) carried out a research on behavioral decision theoretic perspective on hedonic and utilitarian choices and they found out that difference between purchase and consumption of goods and service. The study found out that there was a very thin line which consumer does not even realize and decision making of consumption was merely affected by income, preference and lifestyle of the consumer. Aydin (2006) carried out the research about the consumption patterns in Turkey’s different socio economic classes and found that globalization has led to transformation, reconfiguration and reformulations of class structure and this was leading to social shifts from class based politics to identity politics, ideology to lifestyles and mass production to consumption these forces have fuelled the social change hence leading to emergences of new middle class living a new leisure lifestyle. The research reapproved the fact that social class variables had a significant effect on consumption.Income had the strongest positive effect at all the consumption level simultaneously. Education had effected the class differentiation, i.e., the group with higher education had better living standards thus making education important mediating factor. The analysis in this research paper depicted the class structuration results due to interaction income, education levels, and residential location . .D’orlando(2010) carried out a research to investigate the importance of behavioral principals in micro-foundation of Keynes consumption theory. It was concluded that behavioral instead of maximizing principals can be rightfully considered as possible for micro foundation for Keynes’s work. He said there were chances of cross fertilization of Keynesian approach and behavioral sciences in reference to theory consumption function. This research showed that utility maximization was not the major focus Keynes representation of individual’s behavior and many subjective factors were included in the consumption theory lastly the traditional aggregate consumption function is immensely based on maximizing agents. 3. Methodology: Variables taken in the study will be both demographic and economic variables which are to be estimated.In this research thesis both time series and cross sectional data will be used. On economic variables including consumer price index, income and expenditure will be taken. Consumer price index data are time series for 2004-2014 (10 years) and data on income, expenditure, family size and age are cross sectional. Interview through questionnaire will be undertaken from different income groups of the people living in Rawalpindi to gather the data on factors effecting consumption of household. To obtain the estimates of household consumption an Ordinary Least Square method will be used which meets econometric criteria. In this study two equations will be developed, equation one which will shows the consumption of household who belong to low income class while equation two will represents the consumption of household belong to high income class. In the study CPI, will be taken as independ ent variables which affect the consumption as if there is increase in price level for food and non food items over a period of time it would lead to reduce consumption of the masses as it would lead to reduce the purchasing power of money. The people who can afford to buy more goods before inflation now with the same amount of income they can buy less goods after inflation. 3.1 Data: The population in this study comprise of the District Rawalpinidi. Data will be collected through questionnaire from different classes of people besides secondary sources available on other variables. The sample data on the variables will be collected by interviewing different people through questionnaire from the different class of people residing in Rawalpindi and also from secondary sources on monthly basis so that model shall gives true picture regarding the society behavior of the factors affecting consumption. Generally data has two types in statistics 1) Primary data—first hand data 2) Secondary data—earlier data available In this study primary data will be used for some demographic feature i.e. age and family size and income. Due to non availability of second hand data on variables like family size and age, and income survey will be conducted in Rawalpindi. The sample will include all the heads of households. By considering the resource and time constraints, method of ordinary least square will be used for which sampled peoples will be surveyed in the area of district Rawalpindi for the study. For addressing the issue, a set of few questions will be developed required for the study to be carried out. The study shall be rely both cross section and time series data values. A set of questions will be ask from the respondents to avail the data on demographic features. A questionnaire will be circulated to different groups or sectors including the Public Sector, and Private Sector. The secondary data will be taken from the sources which includes Pakistan Statistical Bureau and from Pakistan Social and Living Measurement regarding the consumer price index variable. 3.2 Model: CHH=f (YL, YH, A, FS, CPI) Dependent Variable: CHH= Average Household Consumption Expenditure (Rs per month) Independent Variable: YL= lower income class; (Avgerage monthly income less than or equal to Rs 25000) YH=High income class (Average monthly income of more than Rs 25000 and less than or equal to Rs 40000) CPI=Consumer price index (index to measure inflation on per month basis) A= Average Age of household (years) FS=Family Size (No of persons) On the basis of variables the following equations developed for estimation purpose. CHHL=ÃŽ ²o+ÃŽ ²1iYL+ÃŽ ²2iFS+ÃŽ ²3iA+ÃŽ ²4iCPI+ µi Equation 1 CHHH=ÃŽ ²o+ÃŽ ²1iYH+ÃŽ ²2iFS+ÃŽ ²3iA+ÃŽ ²4iCPI+ µiEquation 2 Where; ÃŽ ²o = Intercept ÃŽ ²1, ÃŽ ²2, ÃŽ ²3, ÃŽ ²4, is the slope co-efficient of the model. ÃŽ ¼i = Disturbance term of model. i = Number of households (i ~ 1 to 120) Effects of different variables on household consumption Parameter Theoretically expected effect ÃŽ ²1+/- ÃŽ ²2+/- ÃŽ ²3+/- ÃŽ ²4+/- References: Ahmad, E., Shamim, F. (2007). An Analysis of household consumption in Urban and  rural regions, Journal of Retailing and consumer services, 14(2), 150-164. Airola, Jim. (2007). The Use of Remittance Income in Mexico†, International Migration  Review, 41(4), 850-859 Ajmair, M,. Akhtar, N. (2012). Houehold Consumption in Pakistan (A Case Study of  District Bhimber, AJK) EuroJounal publishing Inc 75(3), 448-457 Ali,M.S. (1981). Rural urban consumption patterns in Pakistan.Pakistan Economic and Social  Review 20(2), 85-94 Ali,M.Shaukat. (1986). Household Consumption and Saving behavior in Pakistan: An  Application of the Extended Linear Expenditure System. The Pakistan Development  Review 24(1), 23-27 Aydin, Kemal.(2006). Social Stratification and Consumption Patterns in Turkey. Social  Indicator Research.75(3), 463-501 Bacon, J., German, C. (2000). An Analysis of Household Consumption of Fresh Potatoes in  Delaware, Journal of Food distribution Research, 31(1), 103-111. Bentham, Jeremy (1748). An Introduction to the Principles of Morals and Legislation. The  Encyclopedia of Libertarianism. 31-33 Burki A.Abid (1997). Estimating consumer preference for food, Using time series data of Pakistan. The Pakistan Development Review. 36(2), 131-153. Burney, N., Khan, A. (1992).Household Size, its Composition and Consumption Patterns  in Pakistan, An Empirical Analysis Using Micro Data. Pakistan Institute of Development  Economics, 27 (2), 57 – 72. Carroll, D. Christopher., Fuhrer, C. Jeffry., Wilcox,W. David (1994). Does Consumer  Sentiment Forecast Household Spending. The American Economic Review, Vol. 84(5), 1397-1408 Cheema, A., Malik, M. (1995).Changes in consumption patterns and employment under  Alternative in come distribution in Pakistan The Pakistan Development Review,  24(1),1-22. Chow,Clement K.W.,Fung,Michael K.Y., Ngo,H.Y. (1999). Consumption patterns of  Entrepreneurs in the People’s Republic of China. Hong Kong Institute of Business Studies Working Paper Series 52(2001), 189-202 D’orlando E. Sanfilipo.(2010).Behavioral foundations for the Keynesian consumption  function. Journal of Economic Psychology31(6), 1035-1046. Fei,Linwu., Shu, YU.,Len, Lan Wei.,Teresa, J.C.Yin. (2003). Weight-control behavior among  dobese children: association with family-related factors. Journal of Nursing Research. 11(1), 19-30. Keynes, J.M.(1936). The General Theory of Employment, Interest, and Money. (London:  Macmillan). P.383 Khan,M.I.(1963). A Note on Consumption Patterns in Rural Areas of East Pakistan. The  Pakistan Development Review 3(3). Khan.U, Dhar.R.(2004).A Behavioral Decision Theoretic Perspective on Hedonic and  Utilitarian Choice. Journal of Behavioral Decision Making. 9(4), 265-281. Kruijk,J.L.de,I.C.Havinga J.B. Van Lochem (1991).Consumption behaviour in Pakistan. An  application of the (Extended) Linear Expenditure System. The Pakistan Development  Review 30(4). Malik,S. (1982).Analysis of Consumption Pattern in Pakistan. The Pakistan Economic and  Social Review 20(2), 108-122 Siddiqui,R.(1982). An Analysis of Consumption Pattern in Pakistan. The Pakistan Development Review 21(4), 275-296 Tai.H.C.Susan,Tam L.M.Jackie (1997).A life style analysis of female cosumers in greater  China.Journal of Psychology and Marketing. 14(3), 287-307. Thomas, Duncan (1993).The distribution of income and expenditure within household,  Annales de Economie et de statistiques, 29, 109-136 World Bank.(n.d). (2013). Retrieved from website worldbank.org/data-catalog/world-development-indicator/wdi-2013.

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It is very important for the local organization to transition their strategic to the MEN. Because of the MEN can bring more new opportunities, knowledge, and resources of the information to the organization more than the domestic. It also can help the organization get more competitive advantages in the global. Introduction Tease Motors, Inc. Is a California-based company that designs, manufactures and sells electric cars and electric vehicle perpetration components including lithium-ion battery packs (â€Å"Tease motors,† 2013). Tease Motors is named after electrical engineer and physicist Nikolas Tease.Because of Tease uses an AC motor descended directly from Nikolas Teasel's original 1882 design. Tease Motors producing the first fully electric port car in the world (â€Å"Nikolas tease,†). Background In July 2003, Martin Bernhard and Marc Tarpapering incorporated Tease Motors. In February 2004, Leon Musk became Teasel's Board of Directors as its Chairman. Musk's prima ry goal was to commercialism electric vehicles all the way to mass market, starting with a premium sports car aimed at early adopters and then moving as rapidly as possible into more mainstream vehicles, including sedans and affordable compacts.There are four car models in Tease Motors, which are Tease Roadster, Model S, Model X, and Future models (â€Å"Model s,† 2013). Tease Motors was founded in San Carols, California, in Silicon Valley. In April 2008, Tease Motors opened its first retail store in West Los Angels, California. In July 2008, Tease Motors opened its second retail store in Menlo Park, California. In July 2009, Tease Motors opened a display showroom in New York City's Chelsea Art District. In July 2009, Tease Motors also opened a store in Seattle.Tease subsequently opened stores in Washington, DC; New York City; Chicago; Danni Beach in Florida; Boulder, Colorado; Orange County in California; San Jose in In August 2009, Tease Motors planned to move its corporate headquarters and lid a perpetration development facility at 3500 Deer Creek Road, in the Stanford Research Park in Palo Alto, California. The new facility would occupy 369,000 sq. Ft. (34,300 mm) on a 23-acre (93,000 mm) parcel previously occupied by Agilest Technologies.In February 2010, Tease completed the headquarters move. About 350 employees are expects to be based at the Stanford site initially, potentially increasing to 650 (â€Å"Tease motors,†). Why TEASE Company Need Expand Their Operations Internationally With the development of the internal business, it is necessary that TEASE expand their operations internationally. And there are four reasons as the following: First of all, among the earliest motivations that drove companies to invest abroad was the need to secure key supplies. Christopher & Paul, 2008) With the increase of TEASE cars' demand, they will need more and more materials from different countries. Just like the automobile batteries, which need some cou ntries that have good technology and experience for produce the batteries for the new cars. Also some of the automobile materials need stable producing area to guarantee quality. Secondly, another strong trigger for internationalization could be described as market-seeking behavior. In order to find more wide market and opportunities, TEASE need expand their operations internationally.For example, even though make the TEASEL'S car in the U. S. , American people may not the main consumers of the cars. The reason is that from the culture things American people prefer large and straightforward cars than the light vehicle. However, in other countries, TEASE cars maybe very popular, because the countries which have different cultures may prefer the light vehicle better than the heavy-duty vehicle. So in this case, the TEASE will get more opportunity and market shares in these areas.Beside the culture, different countries developing degree and policy will impact the selection of the cars. For example, in china because of the air pollution, the government made a lot of the rules for limiting the carbon emissions such like some taxes of the carbon emissions. So the electric car will be more and more popular in China. Doing business in foreign countries will get more competitive advantage than Just doing business in home country. The third is that traditional and important trigger of internationalization was the desire to access low- cost factors of production.Christopher & Paul, 2008) No matter what the motivation is, the final things that the company focuses on is the profit. Beside the high sales volume, another important thing they should pay attention is cost. There is a problem the managers considering the every day, which is how to reduce the cost. There is no doubt that expand the operations internationally is a good way to reduce the cost. For example, the labor is more and more expansive in recent years, especially in some developed countries.So if a company could build their manufacture in some developing countries that have low labor fees. They will save a lot of cost. Beside this reason, the freight is another problems for the cost. So the good way to solve the cost problems is expand the operations internationally. The fourth is that internal business will increase scale economies, ballooning R&D investments, and shortening product life cycles that transformed many industries into global rather than national essential prerequisite for companies to survive in those businesses. Christopher & Paul, 2008) The Benefit of Expand Operations Internationally For TEASE Once the TEASE expands their operations internationally, they could use Global Hess. Global chess is a kind of competitive strategy, which could be played only by the companies that managed their worldwide operations as interdependent units that implemented a coordinated global strategy. (Christopher & Paul, 2008) TEASE will get a lot of benefit from the strategy. First of all, that is a positive complementation. For example, now TEASE is very good brand of battery vehicle.And it was born in US with a very good reputation. Because of it name and brand, more and more people know that, especially the foreign countries, they are very expected to try this new care ND that is the reason why that is so popular in some Asia countries. We know that the America population is limited; also because of the fierce competition there are not some much people in US automobile market. However, in Chinese the market will be very wide, there are a lot of people who need good vehicle. So TEASE could get a huge profit from Chinese market.And use this money to create new technology in TEASE in US, and use them back to the Chinese and create better service and suitable cars for Chinese drivers. So that will be a very positive complementation. The second hint is it could promote the company's bad position. For example, TEASE cars will be sold in a lot of countries. However, we c ould not guarantee that TEASE cars could sell well in every country. If a new product want to enter in a new market, it need a very long process, people need time to accept it.During this time, the company will spend a lot of cost such as the inventory fees, advertising fees, managing fees and so on. Expending operations internationally which offer a possible that using Global chess. For example when the company get trouble in Europe, they could use the Asia arrest's good profit to help the Europe company ride out a storm until the new cars are accepted by Europe customers. Finally, this strategy could make sure the abundance of capital.Global chess is very helpful for TEASE adjust their capital among the world business. And that will make the TEASE Company having more power for respond the risk of the world business. Issues When TEASE Becomes Transnational Organization The issues that transnational organizations have to facing with are: the force for local differentiation and respo nsiveness, and the challenge of management style and the lobar business management strategies. With regard of push Tease Motors, Inc. Into transnational organization, these issues are unavoidable.First, the core issues that inside the force for local differentiation and responsiveness is: Cultural differences, government demands and growing pressures for localization. Cultural differences in other word operating in a diversified condition could have numerous barriers and uncertain issues. Each market has their characteristics and talent. For example, in Japan, people are exchanging gifts with their working partners such as suppliers or customers. For American managers it is definitely looks like bribe. And many U. S. Managers thought the action is wrong. Ultra, they turned to accept it and even encourage, the practice as ethical behavior in Japan (Cert., S. & Cert., S. (2012). As this case, the management of transnational organization must facing with the culture shock by diversity. When TEASE reforms them into a transnational organization, they must know the culture of the targeted market. For instance, in vehicle industry, U. S. Market has more pick up truck or heavy engine vehicle. One of the reasons is the usage. However, the other reason is not cause of any geographic or physical reason but people Just like it.When promoting TEASE vehicle to China, management has to a lot of research and completely understanding what they like but not only consider about the pricing or design. In other word, transnational organization managements need to not only consider about technical and general marketing issues but also have to capture all of these specific traits in the target market. The second issue government demands is the issue between home country government and host country government. Both of these two sides are desire for benefits. For host country the benefits would be funds, technology, and expertise from the transnational organization.And for home countr y that desire the transnational organization can successfully growing the host country and bring extra revenue and benefit to both company side and government side. The government of host country is an extremely important access point for the transnational organization. It could let the company access to the local market or receive resources in the host country. When both side of home and host government come into win-win situation, the conflict would not be exist. However, actually the conflicts still existing between two parties.For example, transnational organization would drive rural exodus, rising consumerism, rejection of indigenous values, or a breakdown of traditional community structures of the host country (Bartlett & Beams, 2011). Thus the government of the host country would take a good balance to treat transnational companies. For example, there were a lot of issues of North American Free Trade Agreement (NONFAT); the free trade agreement between the United States, Cana da and Mexico. The expectation of the agreement should be numerous positive things or all of the partner countries.However, in Mexico government perspective, they complained about the environmental pollution issue because of NONFAT. The huge amount of trading also caused a serious damage of nature in Mexico. Deforestation and reduce of farmland getting much worse than before. In annual, more than 630,000 hectares of land has been deforesting after NONFAT official started. Moreover, the large amount using of agriculture chemical also brought a terrible damage of the land. Also other industries cause scarcity of hazardous waste disposal facilities, water pollution issue and scarcity of fresh water simultaneously.According to this Mexico government had announced compensation to the United States government. The data should be questionable here because there is no evidence of the pollution is exactly caused by free trade agreement. However, the point in here is; even under a free trade agreement between two countries, there still have conflict from each other. Similarly, when a transnational organization goes into a oversea market, even they bring new Job opportunities or contribute to the host country, there still would have complain by the government (Villager, 2012). Hence the pressure from governmentThirdly, according to the development of information technology, the living standard is increasing continuously. To meet the needs in each market, transnational organization should be very flexible with market trend. A large group of consumers has emerged to reject the homogeneity product design and performance of standardized global products (Bartlett & Beams, 2011). For example, TV is becoming a part of necessary items in each home. More people are connecting DVD player, game player, computer or other equipment with TV let the homogeneity product â€Å"TV† becomes more entertained product.Hence for TEASE to Join a new oversea market, only selling the vehic le would not be enough to survive in current market trend (Bartlett & Beams, 2011). For TEASE Motors successfully go into oversea market, they should have an unbeatable management style and the global business management strategies. Three strategies that TEASE Motors can be use, Decentralized Federation, Coordinated Federation or Centralized Hub. Each strategy has characteristics for prevent unexpected issues. Decentralized federation is an organizational configuration model that provides authority of most key assets and resources to each subsidiary.And the connection between each subsidiary and head office is comparatively loose. In other words, the organization treats subsidiaries as independent national businesses (Bartlett & Beams, 2011). In TEASE Motors' case, this model should not be efficient and sustainable. The separation of each subsidiary would cause the leaking of information. The coordinated federation indicates decentralized many assets and resources to each subsidiary but still the corporate management has the authority to control everything.Additionally, the linkage between each subsidiary and head office is very tight and formal thus compare with centralized federation, it would be relatively easier to control and protect technologies. Last, the centralized hub means most of the assets and resources are controlled by center office. It only allows a small portion of authority to each subsidiary about management. In other words, this type of managing strategy treats subsidiaries as a pipeline for global marketing (Bartlett & Beams, 2011).It sounds a good managing strategy for TEASE to protect its information and technologies. However, it might cause losing chance to gain new opportunities. Again according to he development of living standard and culture difference, we cannot give a conclusion only consider with these definition of managing model. In management perspective of TEASE, extend market business into transnational organization must cons ider every single piece of information. If they do not have a complete managing strategy, it would be very vulnerable to leak their top business secret or core technologies to others.How to solve the problems in establishing a transnational company In the process of becoming a transnational company, different levels of economic, political, culture, genealogical and management forces are faced to the company. Thus, It becomes more and more vital to the company that how to develop their ability to effectively solve those diverse and conflicting problems at the same time. Transnational company needs to use transnational strategy to solve the conflicting environmental forces and win the competitive advantages.In the aspects of responding to the force for global integration and coordination, transnational company must build global efficiency through a worldwide infrastructure of distributed but specialized assets and capabilities that exploit comparative advantages, scale economies, and scope economies simultaneously. ( Bartlett & Beams, 1943 Pl 25). Through exploiting differences in sourcing and market potential across countries, exploiting economies of scale, and exploiting economies of scope, the transnational company can build worldwide competitive advantages.In the process of exploiting worldwide economies of scale, the transnational company must develop a more sophisticated and differentiated configuration of assets and capabilities, which means the transnational company needs to centralize the key resources and capabilities within the home-country operation to not only realize call economies but also protect certain core competencies; certain other resources must be ex-centralized to complement the benefits of scale economies; and some other resources must be decentralized on a regional or local basis to protect against operation risk and reduce logistical and coordination costs.Also, in order to achieving the competitive advantages, transnational company ne ed to fully understand the concept of â€Å"global chess† which is using cross-subsidizing method to leverage their existing strengths to cover their weaker products and market positions.On the other and, the transnational company not only need to build an interdependent and integrated network organization within the company but also need to collaborate relationships externally with other firms. This needs the transnational company to form strategic alliances and coalitions to collaborate, isolate and defeat competitors through the technology exchange, global competition, industry convergence, economies of scale and reduction of risk.In the aspects of responding to the force for local differentiation and responsiveness, because more and more national customers o longer demand simply differentiation and the host government desires to build their national competitiveness and dominates economic policy in many countries, so transnational company must have the flexibility to chang e product designs, sourcing patterns, and pricing policies continuously to remain responsive to continually changing national environment and to snatch the minimum scale efficiency, as well as the requisite government relationships and consumer understanding to respond to market.In the aspects of the forces for worldwide learning and innovation, transnational company must build the capability to learn environmental and nominative information from many complex circumstances in different parts of the world, collate and interpret that information to become a part of the company's shared knowledge base and provide input to future strategies. Also, transnational company needs to spread and share its learning outcomes to other companies throughout their global operations.In addition, although some products and processes must still be developed centrally for worldwide use and others must be created locally in each environment to meet purely local demands, transnational company must create truly transnational innovations through increasingly use its access to multiple centers of technologies and familiarity with diverse customer learning and innovation is to act as the sensors of new market trends or technological developments; to attract scarce talent and expertise; and to collaborate with other subsidiaries to exploit the resulting new products and initiatives worldwide. Bartlett & Beams, 1943 IPPP) Responding to management forces In the process of managing a transnational company, the management must create the ability to sense and analyze the numerous and often conflicting worldwide opportunities, pressures, and demands.Within the management groups, national subsidiary management is needed to sense and represent the changing needs of local consumers and the increasing pressures from host governments; capable global business management is required to track the strategy of global competitors and provide the coordination necessary to respond appropriately; and influe ntial worldwide functional management is needed to concentrate corporate knowledge, information, and expertise and facilitate their transfer among organizational units. Bartlett & Beams, 1943 IPPP). Because of the unbalance relationship between sectional subsidiary management, global business management, and worldwide functional management in the decision-making, the transnational company need to build the multidimensional perspectives which means the transnational company need to build up the capability, credibility, and influence of the less powerful management groups while protect the moral and expertise of the dominant group to balance the different management groups.Simultaneously, the transnational company should build the integrated network configuration, which means the management needs to specialize and give the responsibility to their national units to dead them become the company's world source for a given product or expertise. However, the parent companies still hold the capability to secure and tap into the operation activities of their national units. Finally, the management in transnational company is required to have the ability to differentiate its operating relationships and change its decision-making roles by function, across businesses, among geographic units, and over time.In turn, the management process must be able to change from product to product, from country to country, and even from decision to decision. ( Bartlett & Beams, 1943 IPPP). Similarly, the transnational company not only needs to build an interdependent and integrated network organization within the company but also need to collaborate relationships externally with other firms. In the process of managing the alliance as following: 1. The management of transnational company needs to evaluate the potential partners, escalate the commitment, and try their best to make the scope of alliance simplicity and flexibility. . The management needs to manage the boundary though struct uring the interface, manage the knowledge flows through integrating the interface, and provide the tragic direction through building an effective governance structure. Responding to challenge forces In responding to the challenge force, the transnational company needs to become a transformation company that not only complete the commitment required but also help developing countries deal with problems.The transnational company needs to make significant investments in developing products or services to meet important to use their positive influence to improve the exploitative and unfair circumstance in the workplace and the communities in which they operate. China – A New Market 1. The Reason of Choosing China A. New Entrepreneur Sometimes, companies that enter the market first would take more advantage than the others, which enter the market later, such as Amazon and Fed. They are both good examples to show the advantage of being leading entrepreneurs. But for China ‘s foreign enterprises, the situation would often Just be the opposite.In this vast, undeveloped, and big market, the phenomenon that firms, which enter later, would take more advantages occurs. In fact, Just entering the market, enterprises are likely to get support from the pioneers. The specialists of business and the legal said that n the automotive, retail and technology industries, new entrants that enter into the business may be more smoothly. Many foreign companies can set up fully owned Company directly, rather than Joint ventures with Chinese government-owned enterprises. Moreover, we can also learn from the lessons advance into the enterprise.Some previous companies entering China is still enduring the trauma that Chinese bureaucracy gave them the last eighties and nineties, not to mention sometimes they had to corruption and inefficient behavior and even local businesses cooperation. B. Potential Upscale Market According to recently study, the power of Luxury purchasing of Chinese consumers is one of the top three positions of the entire world. That implies that China is absolutely a market of huge potential and we should make Tease a luxury brand and the target costumers are the people who are not sensitive to price.About the dealer location, we should select the most high-end shopping center, with many famous brand luxury goods and fashion neighbor, we can see that the initial positioning Tease into China, taking the luxury car brand image. We may take experiences from Apple, for the reason that we are similar with Apple. Since Steve Jobs' published speech, prices of apple products tend to lead to amazing cheer, given Apple's these experiences in China, Phone's brilliant achievements, we have no reason not to learn from Apple. 2.Management Configuration To protect the core technology and essential patents, we decide to adopt geographic subsidiary management; means that we would like to operate subsidiary company in China instead of choose a partner of international Joint ventures. We would send top managers from the US parent company to supervise the local companies and do decision-making with few local managers. We would like to choose Chinese local lealer to make marketing research and development, make marketing plans and charge the sales department. 3.Tease Commitment in China Tease is committed to the principle of working in China, with China, for China. We desire to bring about positive change also extends to the workplace and the communities which we operate. In that case, we would build a partnership with Non- governmental Organizations or supra-government agencies that can provide expertise in social program delivery that the companies typically lack. To be pacific, friendly and be helpful to the local communities though all the sections. We would ray the best to focus on design and develop the new economizing energy engine.

Art In Society Essay

Art is an influential means of presenting the true meaning of beauty in humankind which cannot be expressed by any other ways. It bonds people from all forms of society in such a way they respond to ideas that is universally pleasing to them. Art has the magic in shaping a harmonious society as long as it is being expressed to entertain in a positive and beneficial way. To be able to know the impact of art in a society, it is only required to classify any forms of art in their true and artificial meaning. Although people have different significance to art, the objective in making a true piece of it usually involves human kindness, pride and responsibility. Since art is always influenced by the society it also has a connection with different societies. An egalitarian society in general uses the principle that all men regardless of any race are equal under the law. In industrial society the form of society is in societal structure which means that the society itself is bound by its own rules and structure and separated from other society. Beyond the societies are the doctrines and values. Utilitarianism is the principled policy that an act must have a benefit in order to be morally good. In western principle, this emphasizes that the greatest thing must happen to the most number of people to prove its worth as a utilitarian act (Commitment, 2007). Spirituality pertains to the soul or its love for God or its affections as inspired by the divine Spirit. To classify, the association of spirituality and utilitarianism in art can have different manifestations. Believers of utilitarianism can portray art in any angle, depiction, style, forwardness and with few limitations. Spiritual art however, may emit from the personal spiritual experiences of the artist although the art form is not really related with religion (Sumartono, 2001). Work Cited: Commitment, G. O. (2007). A Wisdom Archive on Utilitarianism [Electronic Version]. Retrieved August 14, 2007 from http://www. experiencefestival. com/utilitarianism. Sumartono. (2001). SPIRITUAL ART AMONG SPIRITUALITIES [Electronic Version]. Retrieved August 14, 2007 from http://asianchristianart. org/exhibitions/asae2001/pages/spiritual-art. html.

Project Leaders Leadership Skills And Expertise

Project Leadership Project leaders really need leadership skills and expertise. A project leader should have managerial skills that efficiently act in accordance to their roles within the organization or community, and stand-out from the congregation. Something must make the leader quite different from the other individuals, especially when the person is currently searching for a job, is worried about his/her job, or is worried about his/her job security given the condition of the current economy. Since this has continually been the case, it is even more significant in the current economy where project leaders are asked to perform more tasks with less cash. They are required to draft budgets for their schemes, use less obtainable†¦show more content†¦Also, I should make a point of boosting my knowledge, and as an excellent leader, I should never stop learning. I should always be interested in improving my set of kills, and to become an all-round leader, I should make a listing of regions that wish to improve. As earlier mentioned, my leadership project is a voluntary nursing home, which I will plan, organize, develop and facilitate in order that will help to me active member in the community. And develop my skills communication. This project will give me opportunity to communication and meet with people who have knowledge. So it will support to increase my knowledge. The project leadership is nursing home in in evergreen health rehab center in Winchester. I decided to volunteer in the nursing home to serve the community after I study the subject and began plan. I contacted with the nursing home center to set up the date. It was identified in November 8. In this day I went to the center to volunteer, it was fun and I felt interesting to deal with the people and help them. 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